This documentary didn't reveal anything that wasn't already known. There aren't any criminal prosecutions because it's hard to prove that there was fraud. It then goes on to speculate why Breuer hasn't been able to charge anyone.
I'm a big fan. They aren't perfect (who is), but they take reporting and informing very seriously, and they dive deep. I've always gotten a lot whenever I've actually sat down to watch. I really need to watch more.
For example, in order to really report on why prosecutions did not happen, you would think they would take some time to explain how federal law defines certain crimes. But, they never did that at all--instead they ask people for a sort of gut reaction as to whether something seemed fraudulent. But of course the word "fraud" has a number of very specific legal definitions in a number of different laws.
One could argue that that is ok, because the real point is that the language of the laws themselves allow people to get away with fraud (in a gut-check sense). But again, to make that point they would have had to get specific about what the law does and does not say.
So while I found this episode entertaining and interesting as always, I did not find it illuminating.
edit: forgot a word
That said, it's really obvious how much work and thought goes into these. If you compare anything of this complexity against perfection, it will always come up short. But I don't know of another news show that consistently hits the level of quality that Frontline does.
Honest question: Does anyone have any suggestions for reporting they think is in the same league? I'd love to check it out.
TV delivers a ton of information, but most of that information is emotional--i.e. facial expressions, tone of voice, etc. A voice on TV cannot speak facts nearly as fast as as you can read them.
I really, really hate this sentiment. "Oh look, it's yesterday's news!". It doesn't matter. It should be repeated every day on every station until something is done about this. How can we claim our "society" is anything more than an illusion when people can be arrested for tampering with devices they purchase, but people who steal billions get a small fine for it.
The only thing Madoff did wrong was he didn't steal enough.
That's nonsense. The following exchange takes place in the documentary where Breuer admits the reason these banks aren't prosecuted is because it is basically government policy not to...
""" MARTIN SMITH: You gave a speech before the New York Bar Association. And in that speech, you made a reference to losing sleep at night, worrying about what a lawsuit might result in at a large financial institution.
LANNY BREUER: Right.
MARTIN SMITH: Is that really the job of a prosecutor, to worry about anything other than simply pursuing justice?
LANNY BREUER: Well, I think I am pursuing justice. And I think the entire responsibility of the department is to pursue justice. But in any given case, I think I and prosecutors around the country, being responsible, should speak to regulators, should speak to experts, because if I bring a case against institution A, and as a result of bringing that case, there’s some huge economic effect — if it creates a ripple effect so that suddenly, counterparties and other financial institutions or other companies that had nothing to do with this are affected badly — it’s a factor we need to know and understand. """
http://www.zerohedge.com/news/2013-01-23/assistant-attorney-...
And the reason for that is that it was government policy that created the situation in the first place: wanting everyone to own a home, whether they could afford it or not, and allowing banks to play games to offset the inevitable losses from being forced to give mortgages to people who couldn't afford them. And it was government policy that called a lot of the shots once things started to go south: they were telling banks who had to merge with who, who had to declare bankruptcy, etc.
I'm not saying the banks aren't culpable: they took risks with money that wasn't theirs to risk, it was their depositors'. But the government is culpable too.
The total amount of support given to the banks was far greater than the total amount of ALL residential mortgages everywhere in the USA. Total support given in all the various ways was over $10 Trillion, while the total value of all residential mortgages is under $4 Trillion.
Support given by the government, right? That would make the government, if anything, more culpable.
total value of all residential mortgages
It's true that my previous comment applied to residential mortgages, but as I understand it, the real estate bubble was not limited to residential; it included commercial and industrial real estate as well. Certainly in my local area there has been lots of overbuilding of office and industrial space. So the correct number to compare with the total of government support given is the total of all mortgages, not just residential.
No it's not that hard to prove their was fraud. It just takes forever to bring up Federal Grand Juries for some many cases of fraud.
The Fed Grand Jury I was on one was dealing with financial crimes from 5-6 years ago. They had so much evidence. My lesson was that only the big fish get fried in federal financial crimes, because everyone else gets immunity to compel their grand jury testimony. (if you can't be prosecuted you are unable to take the 5th and remain silent -- you must testify)